Builders press ONS for a new definition of construction

22 Apr 16 Government statistics take a too narrow view of the definition of ‘construction’, according to the Chartered Institute of Building (CIOB).

The government’s Office for National Statistics (ONS) is consulting industry on its Construction Price and Cost Indices (CPCIs), for which it took on responsibility on 1st April 2015.

The ONS previously developed an interim construction output price index while it develops a long-term solution. This consultation on the construction price statistics will help ONS develop that long-term solution. The consultation seeks to discover more on the price statistics that users want and why, along with details on why these statistics are important to them.

The CIOB says that construction data from the ONS informs industry, alongside clients and investors, on the economic performance and potential outlook for the construction industry. The data can influence decisions on investment in the built environment so having accurate, relevant data available is incredibly important.

Public affairs manager Eddi Tuttle submitted the CIOB’s response to the consultation saying that the ONS’ official classification of construction is too narrow and underestimates the importance of the wider industry. Currently, construction is defined only as ‘on-site activity’ and excludes other ‘off-site’ sectors such as the manufacturing of construction products. It also excludes the work of professional services, such as architects, engineers, quantity surveyors and other consultancies.

Mr Tuttle wrote: “Our concern is not simply that the industry’s economic impact is underplayed and its political voice potentially lessened, though this is likely and unfortunate. Our greater concern is the potential for data being misinterpreted, which can lead to poor policy decisions.

“This has been brought home to us recently, as the CIOB is currently producing a report on productivity in the construction industry. The official data, based on the GVA measure, suggest low productivity growth. This is common across most developed nations. However, much emphasis among those seeking to increase construction productivity is placed on offsite activities, at the design stage or in materials assembly. These would mostly fall outside of construction as defined.”